Question: Current and Quick Ratios. A condensed balance sheet for Apple, Inc., appears in the following.

Required:

Compute the following short-term liquidity ratios for 2011, and provide a brief explanation after each ratio (round computations to two decimal places):

1. Current ratio
2. Quick ratio

Apple, Inc. Balance Sheet September 24, 2011 (in millions) Assets Current assets Cash and cash equivalents Short-term marketable securities Accounts receivable (net) Merchandise inventory Other current assets Total current assets Noncurrent assets Property, plant and equipment (net) Other assets Total assets $ 9,815 16,137 5,369 776 12,891 $ 44,988 7,777 63,606 $116,371 $ 14,632 13,338 $ 27,970 Liabilities and shareholders' equity Current liabilities Accounts payable and other liabilities Accrued expenses Total current liabilities Noncurrent liabilities Long-term debt Shareholders' equity Common stock Retained earnings Total liabilities and shareholders' equity 11,786 13,331 63,284 $116,371